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Monday, June 15, 2009

Time May Run Out For Keppel Club

Source : The Business Times, June 13, 2009

Lease may not be renewed as prime site can be put to other uses

ONE of Singapore's best-known golf clubs could be forced to give up its prime location - close to the upcoming Sentosa integrated resort - and seek a new home.

BT understands from industry sources that the lease on Keppel Club's site near Telok Blangah, across from Sentosa Island, might not be renewed when it expires in just over 11 years as the land has been earmarked for redevelopment.

KEPPEL COUNTRY CLUB - Members could be asked to cough up cash for part of the new redevelopment

A senior club official declined to comment when reached and members said they had not been told of any potential changes. When contacted, the Singapore Land Authority, which is the lessor of the land, issued a one-line statement which read: '10 Bukit Chermin Road is on a 30-year lease to Keppel Club. The lease expires end-2021.'

Land-scarce Singapore already has 11 golf clubs with transferable memberships, including a combination of proprietary outfits like Laguna and members' clubs like Singapore Island & Country Club. There are also several public and quasi-public courses like Marina Bay and NSR Country Club.

All sit on land which are leased on 30-year terms from landlords who include the Public Utilities Board, Jurong Town Corporation and other government agencies. Most have had no problems getting their leases renewed.

But the development of the Sentosa Island, with its Integrated Resorts, has increased the value of the land around the vicinity. The area has seen massive redevelopment with prime waterfront commercial and residential properties like VivoCity, Keppel Corp's Reflections and Caribbean.

'This is prime property,' said an informed industry insider. 'Most golf clubs in Singapore sit on water catchment areas, land adjacent airports or other real estate which cannot house infrastructure. Having a golf club on this Bukit Chermin site is the least productive use of prime land in land-scarce Singapore.'

Going by past practises, this means Keppel Club could be offered a new location. But given that the construction of an 18-hole golf course and full club facilities could easily take five years or more (after several years to source a suitable location), Keppel will have to work quickly.

And with the cost of development likely to be around $100 million, there is also the question of funding.

According to the club's annual report, it had just over $20 million in cash. This means members could be asked to cough up cash for part of the new redevelopment. But the Port of Singapore Authority, which became patron of the club in 1973, could also help finance part of the redevelopment.

The last time that a golf club relocated was about a decade ago, when Warren moved from Kent Ridge to Choa Chu Kang and members had to pay a tidy sum each.

Keppel Golf Club, as it was originally known, was founded on November 1904 on a piece of land first owned by the New Dock Co Ltd. The land and club were later transferred to the Tanjong Pagar Dock Board. The Singapore Harbour Board subsequently took over that piece of land.

By 1973, when PSA took over its operation, Keppel Club occupied approximately 43 acres of PSA-owned land. Four years later, in 1977, PSA leased more land to Keppel Club for the extension of the golf course. By 1980, ambitious plans were fast underway to remodel and upgrade the 18-hole to a new 6,000 metre Ronald Fream-designed golf competition course.

Some $14 million was spent refurbishing the golf course and clubhouse. More upgrading works were carried out in 1994. $22 million bought members a bowling centre, gymnasium, outdoor and indoor tennis courts, movie house and the Olympic-sized swimming pool.

In 2005, a Master Plan was presented to the members to further expand the facilities to take advantage of the sea view, with a sea fronting gymnasium and dancing/aerobic studio, a boardwalk offering alfresco dining, children's play area, video games arcade and roof top dining area. A new multi-storey carpark was also built.